Saturday, July 31, 2010

(July 30) -- The Local Jobs for America Act proposes to spend up to $100 billion to create and save a million public and private jobs in communities this year. While a million jobs sounds like a huge number, let's look at the money spent on that task and analyze the premise.

What does it mean to "create and save"? If a person is laid off after, say, six months on the job, does this job still count as created or saved? Moreover, if you divide $100 billion by a million, you get $100,000. That's a lot of money to spend to "create or save" a single job that may or may not last.

If it goes the least efficient way, the federal government could just pay a local governmental employer the full salary of an employee to guarantee that person a job. According to the U.S. Census Bureau, men's median earnings in 2008 were $46,367 and women's $35,745. So $100,000 will last to pay the full salary and benefits of a median worker for a little over two years. That will guarantee that the job will not disappear at least for this length of time.

The government could do better than that by doing just about anything. . . .

According to the findings, seven out of 10 Americans could have landed their dream job last month if they had known where they see themselves in five years, and the number of unemployed could be reduced from 14.6 million to 5 million if everyone simply greeted potential employers with firmer handshakes, maintained eye contact, and stopped fiddling with their hair and face so much.

"This economy will not recover until job candidates learn how to put their best foot forward," said Labor Secretary Hilda Solis, warning that even a small increase in stuttering among applicants who are asked to describe their weaknesses could cause the entire labor market to collapse. "If we're going to dig ourselves out of this mess, Americans need to stop wearing blue jeans to interviews, even if they're nice blue jeans, and even if that particular office happens to have a relaxed dress code."

1) What were the first official coins issued by the United States and what were they made of?
A. "Nickels," made of wood
B. "Two-bit" pieces, made of melted-lead musket balls
C. "Half-dismes," made from Martha Washington's silverware
D. Captured British "crowns," renamed "liberties," made of gold

Tuesday, July 6, 2010

During the Summer II (July) term I am teaching "Economic Analysis for Business Decisions," Henderson's MBA course in economics. It will be my first time teaching economics to MBA students since my year as a Fulbright Scholar in Armenia, where I taught a two-course MBA economics sequence at the American University of Armenia.

We are using two books for the course. The first is Economics for Managers (2nd Edition) by Paul Farnham. Farnham's book is unique on the market inasmuch as it considers the joint roles of microeconomics and macroeconomics in aiding the savvy manager in making wise decisions. Though the macro section is written from a distinctly Keynesian slant, that particular emphasis does not undo what Farnham achieves overall with his integration of micro and macro in a textbook for capable students of business. I suggest that any economist teaching an MBA program's sole economics course give Farnham's text a look.

Our other book is the classic Economics in One Lesson by Henry Hazlitt. For those unfamiliar with Hazlitt, he was one of America's finest communicators of economic ideas during his prolific career as a journalist that included writing a regular column for Newsweek, as well as serving as a frequent reviewer for the prestigious New York Times Review of Books. If you have never read Economics in One Lesson, you should. I can think of no other book that communicates the single greatest lesson of economics so succinctly and that also applies that single lesson to such a broad variety of topics so deftly.

Because we will be using Economics in One Lesson to stimulate discussion on a broad variety of both macro- micro-economic topics, I am putting together a collection of discussion questions linked to each of the book's chapters. It turns out that a few other minds have already been at work on this topic, and have made the fruits of their efforts available on the web. This present blog post, then, will serve as a road map for any readers who may be working at a similar task--putting together some discussion questions for Economics in One Lesson. In the remainder of the post I will point to the resources I have already found. If any of you know of others I may have omitted, I hope you will post a link to them in the comments section of this post.

So there you have it: my list of discussion resources for Economics in One Lesson. I hope you will find them useful. I'd love to hear from you regarding your thoughts on any of them, and by all means let me know if you are aware of any notable resources I have neglected to mention.